The completion of the formation occurs when the price breaks through the upper, flat trendline before finishing the apex of the triangle.

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The following are key points in confirming the ascending-triangle pattern:

Trend: To qualify as a continuation pattern, a prior trend should exist. Ideally, the trend should be a few months old.

Top Flat Line: At least 2 highs are required to form the top horizontal line. The highs do not have to be exact, but they should be within reasonable proximity of each other. There should be some distance between the highs.

Lower Ascending Trend Line: At least two reaction lows are required to form the lower ascending trend line. If a more recent reaction low is equal to or less than the previous reaction low, then the ascending-triangle is not valid.

Volume and Breakout: As the pattern develops, volume usually contracts. When the upside breakout occurs, there should be a large increase of volume to confirm the breakout.

Pullback: Sometimes there will be a return to the resistance turned support level before the move re-starts.

Price Target: Once the breakout has occurred, the price projection is found by measuring the widest distance of the pattern and applying it to the resistance breakout.

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Conclusion

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On the ascending triangle, the horizontal line represents overhead supply that prevents the security from moving past a certain level.

It is as if a large sell order has been placed at this level and it is taking a number of weeks or months to execute, thus preventing the price from rising further. Even though the price cannot rise past this level, the reaction lows continue to rise.

It is these higher lows that indicate increased buying pressure and give the ascending triangle its bullish bias.